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Rise in operating costs impacts Global Brands H1 EBITDA
22
Aug '14
A rise in operating costs negatively impacted EBITDA in the first six months of 2014 at Global Brands Group, a Hong Kong based marketer of branded apparel, fashion accessories and lifestyle products.

EBITDA in the first half of 2014 totalled to US$34 million as compared to US$44 million in the first half of 2013, which was also a key factor contributing to a core operating loss of US$63 million in the period.

Global Brands, which is spin-off of the branded business of global supply chain specialist Li & Fung clocked a turnover of US$1,349 million for the six months ended 30 June, 2014 compared to US$1,330 million for the same period in 2013.

Although the global macro economy continued to show steady improvement during the first six months of 2014, extreme weather in the US, its largest market, affected sales volumes in the first quarter, Global Brands said.

Operating costs increased by 11.8% to US$463 million in the six months to June 2014, mainly from investments related to acquisitions and new brands added to its portfolio, such as Cole Haan, Quiksilver, Spyder, Juicy Couture and Aquatalia.

Additional factors impacting Global Brands’ first-half results included non-recurring expenses it incurred in relation to its spin-off and listing apart from the hike in operating costs associated with acquisitions made in first six months of 2014.

CEO Dow Famulak said, “We achieved solid results across both our Licensed and Controlled brand segments, primarily due to the fact that we have a well-balanced portfolio that covers a broad spectrum of product categories.”

“On the Controlled Brands side, we have a number of powerful brands, such as Frye, Spyder and Juicy Couture, where we see significant potential and from which we anticipate considerable positive impact on the Group’s turnover and profitability in future periods.”

Fibre2fashion News Desk - India

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